Tadpole plunges on new warning

JOHN SHEPHERD

The crisis at Tadpole Technology deepened yesterday when the maker of portable computer notebooks issued a fresh trading warning a month after announcing worse-than-expected interim losses of pounds 6m.

Investors baled out of the technology stock yesterday, driving the share price down 13p to an all-time low of 42p at the close of dealings.

That price, however, was something of a recovery compared with some trades struck in early dealings at just 33p - virtually half the 1992 flotation price of 65p.

The stock market value of Tadpole is now less than pounds 11m, and considerably shy of the pounds 102m it was worth when the shares hit a peak 424p just 17 months ago. More than 2.75 million shares were traded yesterday, equal to 11 per cent of the total number in issue.

Rumours have swirled all week that Tadpole's problems were continuing to mount, and the trading statement yesterday was released after the company had contacted officials at the Stock Exchange about its concerns over the volatility of the share price.

The latest trading warning envisages a loss of up to pounds 500,000 being incurred this month, which follows the pounds 1.3m deficit run up in April and May. Total revenues for the quarter are likely to be unchanged on the pounds 7m achieved in the previous three months.

The company said that losses in June might be cut to pounds 200,000 if expected orders for the SPARCbook 3XP product come to fruition.

The eventual loss in June, though, will still result in its net assets falling to less than half the value of its called-up share capital, a breach of Section 142 of the Companies Act.

There are 24.8 million shares with a 10p par value in circulation.

George Grey, chief executive, was unavailable to comment on the company's plight, which will necessitate an extraordinary general meeting of shareholders to decide what action to take over the fall in net assets.

Most of the current problems are attributed by the company to much lower than expected demand for its new and high-powered P1000 computer notebook. Geoff Burr last month resigned as head of the key US operations, which account for 70 per cent of group sales.

The P1000 is powered by a 100 MHz Pentium chip compared with the 75 MHz chips used by its main competitors. But at pounds 4,800 each, it is considerably more expensive than similar machines produced by consumer electronic giants such as Toshiba in Japan, which sell for pounds 3,500 to pounds 4,000.